Asia Pacific Data Construction Cost Guide 2025

Construction Cost Inflation 2024-2025

Market

CPI 2024

Beyond the law of supply and demand, market-specific challenges in each market have exerted additional pressure on costs. Here, we highlight markets where construction cost inflation has exceeded the regional construction inflation average of 3.8%.

Hong Kong, China

1.5% 2.1% 2.0% 1.6% 1.3% 3.3% 3.0% 2.0% 0.8% 2.7% 1.8% 2.4% 5.8%

2.1% 3.0% 3.0% 3.0% 3.0% 3.5% 3.9% 3.9% 4.0% 4.0% 4.5% 5.0% 5.0% 5.0%

Malaysia

Philippines 3.9%  The Philippines has seen high interest levels from data centre PropCo and OpCo players looking to capitalize on the country’s population-to-capacity imbalance.  Power availability and the country’s high incidence of natural disasters remain development constraints. Taiwan, China 3.9%  Interest in Taiwan, China remains high from both international and local players.  Headwinds include geopolitical tension, and land and power constraints. Chinese Mainland 4.0%  The Chinese mainland market remains among the most competitive in the region from a mid-spec build perspective, at $7,110,000 per megawatt.  Almost all activity is focused on the internal market, with mainland companies pushing forward their development programs and modifying existing stock, although a small number of international players remain active in China.  There has been some renewed interest in Greater China in anticipation of AI deployments.

Japan 4.0%  The rate of inflation in Japan was lower than expected, possibly due to pricing mechanisms regulating electric power providers.  However, an uptick in activity and newly implemented regulation capping total working hours has restrained availability of the skilled labor force, adding double digit upward pressure to unit wage cost; the weak currency remains a risk for input cost increases ahead.  Despite marginal interest rate increases, Japan’s cost of capital remains among the lowest in the region, and the country remains an attractive destination for foreign investors. Singapore 4.5%  Singapore’s construction cost inflation has dropped dramatically from last year’s 8.0%.  It remains the second most expensive market to build in, largely as a result of its geography and reliance on imports for everything from materials to power; this supply chain dependence also contributed to last year’s peak costs.  Construction activity remains muted in line with regulation.

Australia 5.0%  Australia has continued to see strong and growing demand from both local and international players.  At $9,630,000 per megawatt, it remains the third most expensive location in region for data centre development, in line with its generally high build costs.  Development coming online in the next 12 to 18 months is likely to continue pushing costs up; the current planning plateau between land purchase and construction has kept inflation stabilised at a lower rate than interest would have indicated. India 5.0%  India’s 5.0% increase reflects the significant build activity currently underway.  Abundant land and power, a deep and increasingly experienced pool of contractors and affordable entry costs are driving strong interest in this ever more investable market.

Indonesia 5.0%  Capacity spillover from Singapore into Batam has driven construction cost increases closer to rates seen in established, rather than emerging, markets.  At least three campuses are currently under construction in Batam, with ongoing interest from other Colo providers.  High levels of construction activity, combined with a limited supply of contractors, is driving price increases, despite the nascent market’s relatively inexperienced talent pool.

New Zealand South Korea

Thailand Vietnam

Philippines

Taiwan, China

Chinese Mainland

Japan

Singapore Australia

India

Indonesia

1.7%

COMPARISON OF CONSTRUCTION COST INFLATION 2023/24 TO 2024/25

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0%

2023-2024

2024-2025

CUSHMAN & WAKEFIELD | ASIA PACIFIC - DATA CENTRE CONSTRUCTION COST GUIDE 2025

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